It’s time to run a ruler over Vanguard Global Aggregate Bond Index (Hedged) ETF (ASX: VBND) and SPDR S&P/ASX Australian Bond Fund ETF (ASX: BOND). The ETFs invest in the Fixed interest – International and Fixed interest – Australia sectors/industries, respectively.
The Vanguard VBND ETF (ASX:VBND)
The Vanguard VBND ETF provides investors with exposure to government debt and investment-grade corporate debt from developed markets around the world.
According to our most recent data, the VBND ETF had $323.57 million of money invested. With VBND’s total funds under management (FUM) figure over $100 million, the ETF meets our team’s minimum investment criteria for FUM levels. As a general rule, our team draws the line at $100 million for ETFs in the Fixed interest – International sector because we believe that, relative to smaller ETFs, achieving this amount of FUM lowers the chance that the ETF issuer will close the ETF.
To learn more about the VBND ETF, read our free ETF investment report once you’re done with this article.
SPDR BOND ETF (ASX:BOND)
The name’s… the SPDR BOND ETF. BOND invests in Australian bonds which are investment grade and denominated in Australian dollars with maturities more than one year.
With our numbers for December 2020, BOND’s FUM stood at $48.73 million. Given it has less than $100 million invested, ask yourself (or your adviser) if the ETF is still too small (and if you should wait to buy into it). If you’re concerned the ETF might not be established enough, compare it alongside one of the other Index sector ETFs, using our full list of ETFs.
Are the fees for the BOND ETF bad?
SPDR, the ETF issuer, charges a yearly management fee of 0.24% for the BOND ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $4.80.
The management fee is above the average for all ETFs on our list of ASX ETFs, but keep in mind the ETF may be able to justify the higher price tag with superior performance over time.
Did you know that you get access to our free investment report on Best ETFs Australia? View the free BOND ETF report by clicking here.